Connecticut amends provisions regarding secured and unsecured lending

Connecticut HB 7147 requires licensees under the banking statutes to supervise the operation of their business to ensure compliance with applicable law and to prohibit such licensees from engaging in fraudulent and deceptive acts. The law takes effect October 1, 2017, with provisions relating to compliance policies and procedures taking effect July 1, 2018, and pre-licensing education requirements taking effect January 1, 2019.

This bill makes numerous changes to the Connecticut banking laws. Among other things, it:

• Authorizes the banking commissioner to require the use of electronic bonds to participate in the Nationwide Mortgage Licensing System;
• Amends mortgage servicers reporting requirements;
• Allows the commissioner to provide certain notices to licensees by personal delivery (i.e., email) and establishes when such a notice is deemed received;
• Sets forth the requirements for non-depository licensees to establish, enforce, and maintain policies and procedures that are reasonably designed to achieve compliance with applicable laws and regulations;
• Amends the pre-licensing education requirements (by reducing) for mortgage loan originators, loan processors, and underwriters and establishes when the education requirements must be retaken;
• Applies certain mortgage servicers’ and student loan servicers’ prohibited acts to other licensees;
• Establishes limitations for money transmitters regarding virtual currency transactions and timeframes for remitting money; and
• Sets forth a list of licensees’ prohibited acts.